Oil and waste collide at a former Northern Colorado landfill

The troubled legacies of a Las Vegas oil company and an eastern Larimer County landfill converge along the Poudre River near Windsor.

Feb. 7, 2013

Landowner Thomas L. Johnston is seeking state oil and gas regulators' permission to build an oil rig on this piece of land near Windsor, seen on Jan. 29. Johnston and oil company Ranchers Exploration Partners face potential state sanctions for violations related to drilling atop a closed landfill on Johnston's property. / V. Richard Haro/The Coloradoan

Johnston Landfill timeline

July 1968: The Johnston Landfill opens in Larimer County west of Windsor. April 1982: Larimer County shuts down landfill for failure to comply with Colorado solid waste regulations. Aug. 2010: Ranchers Exploration Partners files with state to conduct oil and gas operations in Colorado and signs surface use agreement with Thomas and Retta Johnston. Sept. 2010: COGCC approves Retta J drilling permit, which lists the site as “range land.” Jan. 26, 2011: Ranchers prepares to drill the Retta J well. State finds landfill surface has been removed and solid waste exposed. Tom Johnston and Ranchers found in violation of Colorado solid waste regulations. March 16, 2011: Ranchers moves Retta J site 200 feet. After new test holes are drilled, state health officials are satisfied the new site does not encroach on the old landfill. May 25, 2011: State health officials declare the landfill site fully repaired and violations resolved. April 23, 2012: COGCC inspection of Retta J site finds inadequate best management practices and no containment of sewage, chemicals and rig oils. April 25, 2012: Ranchers begins drilling Retta J well. The drilling rig becomes unstable and drills through landfill trash. April 27, 2012: COGCC issues Ranchers a cease and desist order and declares a public health emergency at the Retta J site. Ranchers fails to comply with order until COGCC inspector arrives. May 9, 2012: State health officials issue Johnstons and Ranchers a second violation for disturbing the landfill cap without approval. July 9, 2012: Ranchers CEO Melvin Lloyd Richards promises to file a closure plan for disturbed area of landfill within 90 days. July 12, 2012: Medical syringes found at Retta J drilling site. July 19, 2012: COGCC issues Ranchers a violation notice for erosion and other problems at Retta J well pad, setting specific response deadlines. July 23, 2012: Ranchers submits drilling permit applications for three “River West” oil wells on Johnston property. Jan. 23, 2013: COGCC inspects Retta J site and finds the company has done nothing to respond to resolve July 19 violations. May 9 public health violations also remain unaddressed. Feb. 12, 2013: Deadline COGCC inspector set for Ranchers to reclaim Retta J drilling site before state begins enforcement process.

The Coloradoan’s investigation revealed

• Ranchers Exploration Partners’ drilling through the closed Johnston Landfill is the only known case of anyone attempting to drill an oil well through a closed landfill in Colorado. • Larimer County shut down the Johnston Landfill in 1982 after decades of problems with “acutely hazardous waste” at the site. • The state has almost no data on the whereabouts of landfills closed prior to 1993, and there are no requirements that old landfills closed before that date be inspected or monitored. • State public health officials were unaware of the existence of the Johnston Landfill until a neighbor notified Larimer County after Ranchers began preparations to drill there. • The Johnston Landfill situation has prompted Colorado public health officials to share geographic information related to closed landfills with state oil and gas regulators. • Colorado public health officials consider Ranchers and landfill owner Tom Johnston equally responsible for reclaiming the drilling site at the landfill. Both missed a deadline to submit a closure plan to the state, and regulators are considering fines of up to $10,000 for each day the landfill remains unreclaimed.

Where is the Johnston Landfill?

The landfill is about 1/4 mile from both the Poudre River and the River West subdivision in eastern Larimer County near Windsor.

Coming Saturday

Blacklisted by Colorado oil regulators, two key figures in Ranchers Exploration Partners leave behind a pattern of oil and gas regulation violations, and the companies they ran owe the state $150,000 in fines.

Landowner Thomas L. Johnston is seeking state oil and gas regulators' permission to build an oil rig on this piece of land near Windsor, seen on Jan. 29. Johnston and oil company Ranchers Exploration Partners face potential state sanctions for violations related to drilling atop a closed landfill on Johnston's property. / V. Richard Haro/The Coloradoan

The Retta J 1 oil rig comes down after state health officials ordered drilling shut down in 2012 when it was revealed it was drilling into a closed landfill near Windsor. / Nick McGurk/9News

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WINDSOR — When residents of Windsor’s River West subdivision look to the west, they don’t see the Rocky Mountains. They see an unresolved public health and environmental headache never before seen in Colorado, created when a company began drilling an oil well through an old landfill.

Tossing a folded lock-blade knife between his hands, Thomas R. Johnston sat in an easy chair in his parents’ house near Windsor on Jan. 29 and explained why his family wants to drill for oil on their property. Their land is along Larimer County Road 3, the site of the closed Johnston Landfill overlooking the River West subdivision and the Poudre River.

“It’s our God-given right,” he said. “They have the mineral under the ground. It’s under their property, and they have a right to get that mineral.”

The property and the old landfill are owned by his parents, Thomas L. and Retta Johnston, who opened the waste dump in 1968. Thomas L. Johnston was forced to close the landfill in 1982 by Larimer County after state and county health inspectors discovered “acutely hazardous waste” — including open containers of solvents toluene and acetone — at the site.

Inspectors documented more than a decade of substandard operation at the landfill, including chemicals leaching into a stream flowing into the Poudre River and trash left uncovered.

New regulations that took effect in 1993 were supposed to prevent the Johnston Landfill from polluting any water and creating “nuisance conditions.”

But the steps Thomas L. Johnston took to shut down the landfill were never approved by the state. The landfill was never inspected after it closed. The water beneath it was never monitored.

Public health officials filed away the records of the landfill’s closure — many of them mislabeled, calling it the “Johnstown” Landfill — and promptly forgot about it.

Thomas L. Johnston said in January that if he thought the landfill would be harmful, “I would have backed away from it right then.”

An opportunity

The landfill sat quietly beneath several feet of dirt for nearly 30 years until people from Ranchers Exploration Partners, LLC knocked on the Johnstons’ door in 2010.

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Ranchers gave the Johnstons an opportunity to exercise their providential right to have the oil under their land extracted.

Retta Johnston even became the namesake of the oil well Ranchers wanted to drill — the “Retta J #1.”

Nobody in Colorado had ever drilled through an old landfill to get to oil. Thomas L. Johnston said he believed the drilling site was outside the landfill boundary, and he didn’t know enough about oil drilling to suspect that putting an oil well on or near the landfill could pose a problem.

On its drilling permit application for the Retta J, Ranchers listed the drilling site as “range land,” and the COGCC approved it with little review.

“In this case, I did not believe we did an initial investigation, though we followed up shortly after that,” said Colorado Oil and Gas Conservation Commission permitting manager Thom Kerr, adding that it’s easy to look at pictures to determine the current use of the land being proposed for drilling.

It took a complaint from one of the Johnstons’ neighbors and his letter to then-Colorado Senate President Brandon Shaffer to alert the state that the Retta J was being drilled on top of an old dump.

“We learned about it when we got a complaint,” said Warren Smith, spokesman for the Colorado Department of Public Health and Environment’s Hazardous Materials and Waste Management Division. “There are a bunch of old historic landfills out there that we don’t know about. We didn’t know that it (the Johnston Landfill) existed. Neither did COGCC, which issues the drilling permit.”

Larimer County’s oil and gas liaison didn’t know about it either. And when state inspectors initially visited the site after the complaint, they couldn’t figure out where the landfill was. They thought trash blowing around the drilling area might have been the result of someone else’s illegal dumping.

The state has little data showing the whereabouts of Colorado’s closed landfills, and COGCC staff rely on the knowledge of people on the ground, local government and satellite images to tell them how land being proposed for drilling is used.

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“In response to this incident, the landfills we have (geographic) data for, we’ve shared that with the COGCC and they’ve been able to incorporate that into their mapping system,” said Jerry Henderson, unit leader for the CDPHE Solid Waste Compliance Assurance Unit. “We’ve at least taken steps to minimize the likelihood that it will occur again.”

Emergency

Once they received the neighbor’s complaint in January 2011, state health officials immediately sent out inspectors. They found that while Ranchers had been carving out the hillside to construct the Retta J drilling pad, solid waste had been exposed and the Johnstons had failed to mark the landfill’s boundaries, fence it in and post adequate signage.

Inspectors found both the Johnstons and Ranchers in violation of state solid waste regulations for failing to maintain the integrity of the landfill and creating nuisance conditions while carving out a site to drill the Retta J well.

“This is the first time we’ve run into a situation like this where a closed landfill was impacted (by oil drilling),” Smith, the state waste management spokesman, said. “It’s a real anomaly.”

The state required Ranchers to move the drilling site 200 feet and drill a series of 6-foot-deep test holes to ensure no refuse existed there. State health inspectors were satisfied that the new site was outside the landfill boundary.

But the state again failed to look closely enough.

If the test holes had been drilled two feet deeper, inspectors would have found that the new drilling site was also atop the landfill, state public health records show. A year later, in April 2012, Ranchers began drilling and hit solid waste 8 feet beneath the surface.

Then the drilling rig became unstable. The soft landfill cap allowed the rig to settle about 4 inches, and the drillers propped it up with concrete.

At the same time, a state oil and gas inspector documented a lack of containment of sewage, chemicals and rig oils at the drilling site.

The state immediately issued Ranchers a cease and desist order and declared a public health emergency in part because Ranchers was unqualified to handle human waste at the site. Again, public health officials cited Ranchers and Thomas L. Johnston for illegally disturbing the landfill without state authorization and for mishandling solid waste.

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Last July, soon after Ranchers promised to clean up the mess, a state oil and gas inspector found medical syringes and debris at the site, weeds growing there, and inadequate erosion control. The inspector issued Ranchers another violation notice, and the CDPHE required Ranchers and the Johnstons to submit a cleanup plan by the fall.

“There is no damage to the landfill,” said Melvin Lloyd Richards, a man who signed his name as Ranchers CEO throughout 2012, but said during a January call to Ranchers’ Las Vegas headquarters that he’d only ever served as an independent consultant to the company and had never been CEO.

Last July, Richards submitted a plan to clean up the solid waste at the Retta J site and promised to submit within 90 days a closure plan for the part of the landfill the company disturbed. Richards signed the cleanup plan as a Ranchers “managing partner.”

No resolution

Ranchers and the Johnstons still haven’t restored the landfill.

They missed a fall deadline to submit a reclamation plan for the Retta J site, and state health officials are considering fining them together up to $10,000 per violation per day if they don’t comply by spring. Though Smith said the landfill poses no imminent threat to the Poudre River because no chemicals have been found leaching from the dump, the CDPHE may require monitoring and regular inspections in the future.

Though state records show CDPHE notified him in writing of the violations he and Ranchers are responsible for resolving, Thomas L. Johnston said in January that the state never notified him of any problem.

“That’s news to me,” he said. “I don’t recall them being out here and finding any problems.”

On Jan. 23, the Retta J site failed another state inspection because Ranchers had done little to correct its previous violations. The COGCC inspector gave Ranchers and the Johnstons until Feb. 12 to shore up stormwater management and erosion issues on the drilling pad.

If Ranchers doesn’t act, the COGCC could settle with the company or find it in violation, forcing Ranchers to face an oil and gas commission hearing before the state considers enforcing its regulations, Kerr said.

Despite the pattern of problems at the landfill, Kerr said that with three new drilling permits pending for the Johnstons’ property, it’s still possible Ranchers or another company could be allowed to drill there.

“We just need to resolve where that somewhere would be so it’s not going through the landfill,” he said.

In the grand scheme of environmental problems that could arise at drilling sites, the landfill situation isn’t so bad, he said. Worse things have happened elsewhere.

“I don’t see it as a major environmental impact,” Kerr said. “It’s just a series of unfortunate events.”

COMING SATURDAY

Blacklisted by Colorado oil regulators, two key figures in Ranchers Exploration Partners leave behind a pattern of oil and gas regulation violations, and the companies they ran owe the state $150,000 in fines.